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Just as employees must build up National Insurance Contributions (NICs) throughout their working life in order to access state benefits, so must those in self-employment. However, employers usually set up the PAYE system to deduct Class 1 NICs automatically for their workers, while self-employed people must pay Class 2 and/or Class 4 contributions directly to HMRC after submitting a tax return.

Following an announcement last September, the government has introduced a 1.25% increase to NICs from April 2022 – known as the Health and Social Care Levy. Despite this increase, it seems that self-employed people with profits within a certain limit could actually pay less in NICs in 2022.

Let’s look into the latest changes for self-employed NICs and what they’ll mean for you this year.

It’s no secret that the pandemic has had a huge impact on the UK’s finances, with the government looking to recoup the costs of various COVID-19 economic support packages. At the end of 2020, a newly launched independent think-tank called the Wealth Tax Commission published a report that pushed the idea of a UK wealth tax back into popular discussion.

The Wealth Tax Commission report suggested that restructuring the tax system is the most viable option, and that the government should be taxing wealth and other types of income instead of only increasing taxes on employment earnings.

Many economists think that such a wealth tax could be the solution to the UK’s soaring public debt and financial inequality crises. Yet none of the Chancellor’s budget announcements in the last two years has explored the concept – so what happened to introducing a wealth tax?

A recent First-Tier Tribunal (FTT) ruling in favour of the taxpayer has challenged HMRC’s belief that renting out a room or piece of land alone is not exempt from VAT. In the case of HMRC vs Errol Willy Salons, the FTT dismissed HMRC’s VAT assessment in support of aggrieved salon owner Errol Willy.

Following an announcement in 2014 and a consultation in 2021, the government is drafting legislation that will increase the normal minimum pension age (NMPA). This means that the minimum age that most savers can access their pensions will rise from 55 to 57 in April 2028.

The government is changing the NMPA to align with the increase in the State Pension (SP) age, which will be rising to 67 in 2028. These changes are meant to encourage people to keep working and saving for longer before retirement – but what if you want to take your private pension earlier?

Since the start of the COVID-19 pandemic, the UK government has been supporting small businesses through various loan schemes. Hundreds of billions of pounds were invested into economic support packages to keep employers and their employees afloat during a difficult time for many.

Unfortunately, a small percentage of fraudsters managed to claim some of this money under false pretences, effectively stealing billions of taxpayers’ money. In response, the government formed the Taxpayer Protection Taskforce (TPT) in 2021, which will continue investigating until 2023.

So, what exactly is the TPT doing to tackle COVID-19 fraudsters, and what does this mean for your business if you claimed COVID-19 relief during the pandemic?

Previously called Entrepreneurs’ Relief, the type of CGT (Capital Gains Tax) relief now known as BADR (Business Asset Disposal Relief) is only available for trading companies and groups that carry out primarily trading activities.

Gains from the disposal of company shares may be eligible for a reduced CGT rate of 10%, but only if the activities of the trading company ‘do not include, to a substantial extent, activities other than trading’ – but what qualifies as ‘substantial’?

Those concerned about qualifying for Business Asset Disposal Relief and claiming CGT reductions will be interested to know that the definition of ‘substantial non-trading’ has recently changed.